"Time Flies" like this seaplane did right past my excursion boat in Vancouver, BC harbor (click to enlarge photo). My personal distractions still abound, so while I can, let's get back to finishing my "one suggestion" to help the Search Marketing Industry grow.
I'm trying to help both SEO and the Search Engine Advertising part of SEM, or as it's called, "Paid Placement", but not "Paid Inclusion", as it has the potential for at least the appearance of favoritism in the ranking of listings in SERP's. However, SEO needs more help as noted in Stoney deGeyter's "SEO Accounts for Only 11% of SEM Spending" (Please note - I do not recommend any specific SEO firm only because I have not directly worked with them. Only clients and former clients should recommend specific SEO-SEM firms, in my opinion.)
Now to continue where I left off in Part XVIII of this series.
I covered a lot in my last post, but I didn't go into detail on HOW TO CALCULATE THE EXACT DOLLAR VALUE AMOUNT OF EACH INDIVIDUAL "ACTION" or "KPI". These actions can include online sales, but not offline sales. As the definition of "conversion rate" says: "The desired action can take many forms, varying from site to site. Examples include online sales of products, membership registrations, contest entries, feedback forms, document downloads, coupon printing, newsletter subscriptions, e-mail contact links or forms, software downloads, or just about any activity beyond simple page browsing."
The goal is to specify an exact formula to relate payment price for each exact kind of action to performance outcomes with a long term goal of "Return On Investment" for both SEO buyer and seller. Of course, initially, the overall total dollar amount of the sum of all the benchmarked current (or newly created) actions will equal the dollar amount of (about) 70% of the SEO's regular yearly contract pricing. But, with good SEO performance, the SEO firm can potentially start seeing "increased over benchmarked amounts of actions" in the fourth through the sixth month of that performance based pricing contract. This could continue throughout the remaining six months, thereby providing higher than normal SEO compensation. The client wins in that scenario, since he is getting increased KPI actions that are online sales, or increased actions that lead to more online sales, or increased actions that should further convert to more offline sales. He also wins, since he is potentially paying only (about) 30% of the SEO's regular yearly contract pricing in the first six months, and then the rest of the year he is paying on a total "Pay Only For Actions" basis.
First, the SEO buyer and seller, together, should figure out the QUANTITY & the QUALITY VALUE of each exact kind of action. When it comes to online sales, both parties could agree to a set "higher than normal" standard price. But, then the client should consider paying a "bonus" for sales over a certain amount. This bonus payment, if applicable to the client's kind of sales, should be over and above the restriction of that "(about) 70% of the total SEO's regular yearly contract price" restriction. It could be a percentage of that incremental sale amount over the "certain amount". This would encourage the SEO seller to provide additional consultative advice, as well as SEO expertise targeted at "larger sale buyers" (as long as the SEO firm had web analytic access to the dollar amounts of each online sale). Again, please keep in mind that it is difficult for anybody to provide a "one size fits all circumstances" suggested approach here.
My next suggestion for the "exact formula" is to prioritize each action starting with a lowest "common denominator" dollar value action being equal to a factor of "1". For example, this action could be a simple "request for more information" e-mail, in which the prospect had to fill out a SHORT information gathering "contact form". If a long information form is filled out online, then the factor may increase to "2". The idea is to have the "denominator" ("The expression written below the line in a common fraction that indicates the number of parts into which one whole is divided.") always be "1".
So, you could assign factors like "1.25", "1.5", "1.75", or "2", etc. to each exact kind of action based on current QUANTITY-FREQUENCY and QUALITY VALUE. Of course, a new "SEO firm suggested action" that is implemented would be based only on its QUALITY VALUE, as it would not have a track record of QUANTITY. The theory here is that if a new action is introduced, other actions probably will be negatively affected. In doing a "reverse mathematical" formula based on that "(about) 70% of the total SEO's regular yearly contract price", it is possible to figure out what each exact action's dollar value should be.
"Finalizing Details" of my "one suggestion" to follow.
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